The electric auto maker said in a statement late Sunday that prices for most models worldwide would go up by about 3% after it made a decision to "keep significantly more stores open than previously announced".
Tesla says the move will allow it to keep open more of its Tesla stores than previously planned. InsideEVs, a publication close to Tesla, tracks USA electric vehicle deliveries and according to its numbers, January and February deliveries were down by around 80 percent compared to the months leading up.
The electric vehicle manufacturer announced February 28 that it was planning on closing nearly all of its physical stores and switching to a purely online sales model, Business Insider reported.
In a Monday filing with government regulators, Tesla now says it closed 10 percent of its stores, but a few of those will now remain open. Physical stores will have a small selection for customers who want to test drive a auto or drive one off the lot immediately.
It's not clear if Tesla will increase just the base price of the vehicles, or if certain options will be subject to the price hike as well. Ramsey asked. "It's nearly as if the decision was announced and made without any analysis of what the outcome would be". A small number will be kept in inventory if you want to drive away with one immediately, it added.
Musk, 47, tweeted on August 7 that he had secured funding to take Tesla private at $420 a share, and that he had confirmed investor support for the transaction. The SEC filed a securities fraud complaint, and Musk and Tesla agreed to each pay $20 million and to governance changes including a Twitter monitor for Musk. Although Tesla said it would concentrate on making up volume in Europe and China, neither of those markets appear able to take up the US' slack.
A copy of Tesla's blog post explaining the new store and pricing update has been provided below. Musk did not specify how many stores would close, or how many jobs would be lost as a result.
Tesla disclosed Monday in a government filing that it had shuttered 10 percent of its retail locations, but it is now reevaluating each of its stores.
Barclays analyst Brian Johnson said it would also be hard to achieve the cost savings needed to lower the price of the Model 3 through store closures alone.
The controversy pertains to a post Musk fired off last month, saying the company would make about 500,000 cars this year.